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How fully do people exploit their bargaining position? The effects of bargaining institution and the 50–50 norm

Nejat Anbarci () and Nick Feltovich ()

Journal of Economic Behavior & Organization, 2018, vol. 145, issue C, 320-334

Abstract: A recurring puzzle in bargaining experiments is that individuals under-exploit their bargaining position, compared to theoretical predictions. We conduct an experiment using two institutions: Nash demand game (NDG) and unstructured bargaining game (UBG). Unlike most previous experiments, disagreement payoffs are earned rather than assigned, and about one-fourth of the time, one bargainer's disagreement payoff is more than half the cake size (“dominant bargaining power”), so that equal splits are not individually rational.

Keywords: Nash demand game; Unstructured bargaining; Real effort; Dominant bargaining power; Experiment (search for similar items in EconPapers)
JEL-codes: C78 C72 D81 C90 (search for similar items in EconPapers)
Date: 2018
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Working Paper: How fully do people exploit their bargaining position? The effects of bargaining institution and the 50–50 norm (2016) Downloads
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